The current market price for a widget is $150 and quantity demanded at that price is 80 for textbooks. If price decreases to $90, and quantity demanded increased to 180.  How much is the price elasticity of demand? At this price change is it the elastic, inelastic or unit elastic, and why? Given the information on the price elasticity of demand of textbook, what happens to total revenue for this market for the decrease in price and wh

Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter7: Consumer Choice And Elasticity
Section: Chapter Questions
Problem 13CQ: Suppose Erin, the owner-manager of a local hotel projects the following demand for her rooms: a....
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  1. The current market price for a widget is $150 and quantity demanded at that price is 80 for textbooks. If price decreases to $90, and quantity demanded increased to 180.  How much is the price elasticity of demand? At this price change is it the elastic, inelastic or unit elastic, and why?
  2. Given the information on the price elasticity of demand of textbook, what happens to total revenue for this market for the decrease in price and why.
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